ICAO grounded, IMO adrift – EU must act!

At the Kyoto climate change conference in 1997, the parties agreed that international emissions from aviation should be handled by ICAO, and from shipping by the International Maritime Organisation (IMO). Until recently, little or nothing was done by either body, and the EU’s decision to enter aviation into its Emissions Trading Scheme (ETS) was born out of disgust with ICAO’s inactivity.

Both ICAO and IMO seemed to think they could carry on entirely free from fuel taxes and other market-based measures – until last year, when they got a shock at the Copenhagen climate change summit. There they were identified as potential contributors to the UN’s $100bn fund for climate change action in developing countries. The IMO moved quickly to finalise its fuel efficiency standard for new ships (EEDI) and set up an expert group to examine market instruments, which produced an excellent and thorough report in record time. But these moves prompted leading developing countries – notably China, India, South Africa, Brazil and, most vociferously, Saudi Arabia – to finally declare their hand and start blocking moves, as they did by blocking the EEDI this month. They also did their best to undermine the EU’s attempts to rein in aviation’s climate impact at the ICAO assembly.

Opposition from leading developing nations to global action on aviation and shipping is now vehement, but also somewhat perverse. How does it benefit all those export-dependent countries in the long term to have gas-guzzling ships and planes when fuel prices rise to levels currently unimaginable? China’s opposition to efficiency standards was argued on the basis of competitiveness, but it doesn’t build fleets of ships and put them up for sale to the highest bidder; each ship is built to the owner’s specifications and to a price paid by Western companies. Chinese opposition to an efficiency standard cannot be based on rational argument.

And it isn’t. It is based on a question of principle which now influences the work of ICAO and IMO from top to bottom. It is the principle underpinning Kyoto: that historical responsibility for emissions rests with developed countries, and that they must act first. Yet the USA refused to sign the Kyoto protocol because action from developing countries was not required. This is the deadlock, but it’s a deadlock that the USA and the developing countries seem happy with as they were working together in Montreal.

One might have hoped America would have remained silent at Montreal, and its action to scupper the ETS is the biggest disappointment for those who felt Barack Obama really understood the environmental argument. The philistine nature of the US aviation industry and its spokesmen in the International Air Transport Association should never be underestimated.

The course for Europe is now clear. The EU must press on with the ETS and strengthen its provisions, as it committed to do, just as soon as the EU itself commits to an overall climate change reduction target of 30%. It can take additional measures, such as a fuel tax on intra-EU flights and end distortions such as the zero-rating of value-added tax on airline tickets. The new Australian government is talking of carbon taxes, and New Zealand now has a domestic ETS. Maybe Obama will prove more enlightened after next month’s Congressional elections? On shipping, the EU now needs to proceed quickly with its plans to include shipping in the EU ETS. Last month’s IMO meeting showed clearly that the EU’s deadline for the IMO to adopt a global measure by the end of 2011 is well out of reach.

The signal is almost as important as the measures. Europe must tell the world that we cannot go on like this – and after all, deep down, everyone from Beijing to Washington knows it.